We have previously demonstrated that the suppression of IL-6 and TNF-a production in the liver by Dexamethasone (Dex) treatment depressed not only the hepatocyte but the oval cell proliferation as well. We also observed that biliary cell proliferation induced by bile duct ligation was not sensitive to Dex treatment. The goal of these studies is to elucidate the mechanism(s) responsible for the different growth response of these two biliary derived cell populations. Current work has revealed that the NF-kB and STAT-3 transcriptional factors were highly active in the proliferating oval cells, but this activity was dramatically reduced following Dex treatment together with the proliferation. The activity of these nuclear factors was much lower in the biliary cells following bile duct ligation. These results indicate a central role of NF-k B and STAT-3 in oval cell proliferation. We further discovered that TNFa receptor type I (TNFRI) was not expressed on the early population oval cells but gradually appeared as the oval cells differentiated into hepatocytes. These observations were confirmed by western blotting and flow cytometry. As far as we know this is the first discovery of a differentiation dependent regulation of TNFRI expression during hepatic stem cell activation. The absence of TNFRI from early oval cells raises the intriguing possibility that the TNFa/TNFR1 signal transduction system might only indirectly affect the regulation of activation and early expansion of the hepatic stem cell compartment. Our future work will continue to be focused on elucidating the role of the TNFa/TNFRI signaling system in hepatic stem cell biology and how this signaling pathway may interact with the SCF/c-kit signaling system.